Some of the biggest musicians in the world have recently made large sums of money by selling various kinds of catalogs and publishing-related intellectual property rights. 80% of Stevie Nicks’ catalog was sold for $80 million.
A 50% interest in his publication rights cost Neil Young $150 million. $200 million went to Ryan Tedder. Two deals went to Bob Dylan. For $400 million in December 2020, he sold Universal Music.
A little over a year later, he paid Sony $200 million for his master recordings. Bruce Springsteen sold Sony his discography in December for $500–600 million. And if the allegations are accurate, Justin Bieber is going to join a group of well-known musicians that make a lot of money from catalog sales.
If the rumors are accurate, Justin Bieber will soon sign a contract giving Hipgnosis Songs Capital ownership of the singer’s publishing and recorded music archives. The purchase cost?
Following the transaction, Hipgnosis would receive all future revenue from Justin’s composition credits and music royalty earnings. If finished, it would be the largest service offered by Hipgnosis and it comes at a time when the excitement surrounding music catalog purchases has significantly subsided.
Investors are concerned that the perceived worth of music libraries, like many other innovative assets like SPACs, crypto, and NFTs, may have been inflated by a low-interest rate environment, as evidenced by the more than 30% decline in the stock price of Hipgnosis year to date.
However, despite being only 28 years old, several of Justin Bieber’s songs already qualify as “classics” and will continue to generate large royalties for years to come. They are not passing trends that no one will still be streaming in a few years.
The agreement would not cover Justin Bieber’s master recordings or any other copyrights that belong to his record label, Universal Music Group.
Prior to the purported agreement, we pegged Justin Bieber’s net worth at $340 million, based on the premise that the value of all of his intellectual property would come to $200 million.